The transmembrane domain of the Alzheimer's beta-secretase (BACE1) determines its late Golgi localization and access to beta -amyloid precursor protein (APP) substrate.

Release of Abeta peptides from beta-amyloid precursor protein (APP) requires sequential cleavage by two endopeptidases, beta- and gamma-secretases. beta-Secretase was recently identified as a novel membrane-bound aspartyl protease, named BACE1, Asp2, or memapsin 2. Employing confocal microscopy and subcellular fractionation, we have found that BACE1 is largely situated in the distal Golgi membrane with a minor presence in the endoplasmic reticulum, endosomes, and plasma membrane in human neuroblastoma SHEP cells and in mouse Neuro-2a cell lines expressing either endogenous mouse BACE1 or additional exogenous human BACE1. The major cellular beta-secretase activity is located in the late Golgi apparatus, consistent with its cellular localization. Furthermore, we demonstrate that the single transmembrane domain of BACE1 alone determines the retention of BACE1 to the Golgi compartments, through examination of recombinant proteins of various BACE1 fragments fused to a reporter green fluorescence protein. In addition, we show that the transmembrane domain of BACE1 is required for the access of BACE1 enzymatic activity to the cellular APP substrate and hence for the optimal generation of the C-terminal fragment of APP (CTF99). The results suggest a molecular and cell biological mechanism for the regulation of beta-secretase activity in vivo.